The Company’s net loss was $8.2 million or $0.42 per share in the fiscal 2007 third quarter as compared to a net loss of $7.4 million or $0.38 per share in the fiscal 2007 second quarter. The fiscal 2007 third quarter includes restructuring charges of $1.4 million or $0.07 per share. Other expense for the quarter included a $900,000 loss on the sale of the equipment remaining in the U.S. after operations were completed at the Litchfield, MN and Eastlake, OH facilities. The Company’s fiscal 2007 third quarter net loss excluding the restructuring charge was $6.8 million or $0.35 per share. The Company’s fiscal 2007 second quarter net loss was $4.8 million or $0.25 per share excluding restructuring charges of $2.7 million.

 The fiscal 2007 third quarter operating results were impacted by weak customer demand, especially from the Hard Disk Drive (HDD) sector. Although the June quarter is typically the weakest quarter for the HDD industry, demand was further impacted by inventory adjustments made by HDD customers during the quarter.

 Flex Suspension Assembly (FSA) products constituted 49% of the Company’s net sales for the fiscal 2007 third quarter, Actuator Flex Circuit (AFC) revenue was 31%, Flat Panel Display (FPD) product revenue was 14%, and integrated circuit packaging application, network system and other application revenue was 6%.

 “Revenue for the quarter was lower than expected as a result of soft demand for legacy disk drive products and significant inventory adjustments at our disk drive customers. We did begin volume shipments on a large new desktop disk drive program in June, which will drive increased AFC revenue in the September quarter. In addition, FPD programs begin ramping in June and we expect sizeable FPD revenue increases in the next several quarters,” commented William P. Murnane, Innovex’s Chairman and CEO. “During the June quarter we made excellent progress qualifying a new AFC program at a new HDD customer. We expect formal qualification early in the September quarter and expect to begin volume shipments in the same quarter.

 “Although we are disappointed with the June quarter results, we are pleased that our long awaited FPD and AFC ramps have begun. We expect these ramps to generate substantial revenue growth and much improved operating results in the ensuing quarters,” stated Murnane.

 The restructuring charges are primarily related to the Company’s plan to transfer all its manufacturing operations to Thailand. The closure of the Litchfield, MN and Eastlake, OH facilities mark the end of a three year effort to lower the Company’s cost structure and move all manufacturing operations offshore. Offshore manufacturing became a critical component of the cost leadership strategy the Company adopted three years ago when it learned its FSA product would become obsolete.

 The Company’s efforts to transfer operations to Thailand are nearing completion. Decommission of the Eastlake facility is expected to be complete by the end of July 2007 and efforts are underway to sublet that facility.

 Manufacturing operations at the Litchfield facilities were completed in April 2007 and decommission of the facilities has been completed. Transfer of equipment from the U.S. to Thailand is expected to be completed by the end of calendar 2007.

 A purchase agreement has been signed to sell the Litchfield facilities for approximately $2.4 million. The sale is expected to close during the fiscal 2007 fourth quarter. $1.2 million of the cash proceeds from the sale will be used to reduce the Company’s outstanding long-term debt. The Maple Plain facility was sold during the fiscal 2007 third quarter for $4.25 million. Proceeds from the sale were used to reduce the Company’s outstanding long-term debt.

 Cash used in operating activities in the fiscal 2007 third quarter was $3.6 million. The Company had a cash balance of $9.7 million at June 30, 2007, an increase of $1.8 million. Total long and short-term debt outstanding at June 30, 2007 was $42.2 million, an increase of $1.8 million from March 31, 2007. Capital expenditures for the fiscal 2007 third quarter were $1.0 million. Capital expenditures for the fiscal 2007 fourth quarter are expected to be approximately $1 million and will primarily support cost reduction projects.

 Cash availability under the Company’s existing credit facilities as of June 30, 2007 of approximately $30.0 million and cash on hand of $9.7 million are expected to provide adequate cash resources to complete the Company’s restructuring and support the revenue growth anticipated in the next several quarters.

 Conference Call & Live Webcast

 Innovex will conduct a conference call and webcast for investors beginning at 5:00 p.m. Eastern Time (ET) on Monday, July 16, 2007. During the conference call, Mr. Murnane and senior managers will discuss the Company’s future product, revenue, mix and margin expectations along with historical results.